RIM – Bold Steps to Weather the Storm

With smartphones poised to be the fastest growing handset segment, RIM is bound to face increased competition from Apple (NASDAQ: AAPL), Nokia (NYSE:NOK), HTC (TPE:2498), Samsung (SEO:A009150), Motorola (NYSE:MOT), and other new entrants.

The increasing popularity of Apple’s iPhone and the rapid onslaught of Android-based smartphones will surely lead to their increased adoption in the corporate world, thus loosening RIM’s stronghold on the enterprise domain. This heat of competition is reflected in the >30% decline of RIM’s (NASDAQ: RIMM) stock value over the last 3 months.

To counter the increasing threat of competition, RIM should:

Expand around core competency – Enterprise applications incl. email

Focus on mid-tier smartphones especially, the sweet spot for high volumes, as smartphones ramp up to be a mass-market play i.e. establish price-point that is maintained at ½ to 2/3 of iPhone

Expand into Emerging Markets (BRIC – Brazil, Russia, India, China) via enterprises, where GPRS/EDGE is still the norm and is adequate for Email/IM etc.

Innovate around Email/SMS to make it user friendly (e.g. speech recognition)